An employee doesn’t need to sue if he feels his employer owes him money. Instead, he can bring his case to the Labor Commissioner. The Labor Commissioner runs the Division of Labor Standards Enforcement (DLSE) in the Department of Industrial Relations. The DLSE will take the employee’s complaint, hold one or more hearings, and can sometimes represent the employee in court — all free of charge to the employee.
Employers Often Find a Hostile Forum Before the Labor Commissioner. That part of the Labor Code which gives the Labor Commissioner his authority may be weighted in favor of the employee. For example, many employers don’t realize that failing to pay an employee on his regular payday can be a crime, and that the Labor Commissioner has the power to enforce it. [Lab. Code §§ 215, 98(a).] California has determined that the prompt payment of wages is a fundamental public policy, and that employees who feel they have not been fully paid must have an easy, inexpensive route to obtain their full wages. It is not surprising, then, that some employers who appear before the Labor Commissioner do not feel treated fairly.
Losing Before the Labor Commissioner can be Expensive for the Employer. The Labor Commissioner has the authority to hear a case similar to the authority of a judge. [Lab. Code § 98.2(a).] The cases are heard by a Deputy Labor Commissioner, who can hear arguments from both sides and accept any evidence he wishes to. All parties are under oath during these proceedings. The Labor Commissioner’s ruling has the force of law, and is enforceable in the Superior Court. [Lab. Code § 98.2(d).]
The Labor Code is replete with penalties against an employer which the Labor Commissioner can assess. For example, if the Labor Commissioner believes an employer wilfully failed to pay a terminated employee everything owed on that employee’s last day, the employer can be assessed up to a month’s wages as a penalty! [Labor Code § 201.]
The problem for employers is this: if the Deputy Labor Commissioner gives the employee an award, and the employer wishes to appeal to the Superior Court, the employer must pay the employee’s attorneys’ fees if the employer loses! [Lab. Code § 98.2(b).] In a case like this, to avoid having to pay the employee’s attorneys’ fees, the employee must receive nothing from the Superior Court. In other words, the Deputy Labor Commissioner’s ruling must be completely reversed for the employer to avoid paying the employee’s attorney’s fees.
Employers Need to Get Help Early. An employer who has been summoned by the Labor Commissioner needs to realize that the cards are stacked against him. It is important to turn the tables and to win at the Labor Commissioner’s hearing, or at least to minimize the award to the employee.
This can be difficult, but it is not impossible. Many employees don’t use attorneys at these hearings, even though they are entitled to do so. Employers, on the other hand, should seek legal counsel early. This can be relatively inexpensive, since a Labor Commissioner hearing is relatively quick, and does not involve discovery such as one would encounter in a civil lawsuit. Above all, bear in mind that an early victory at a Labor Commissioner hearing can avoid the risk of having to pay costly attorneys’ fees later.
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